...defined as the relationship which arises where one person known as the agent acts for another known as the principal. Through the acts of the agent, the principal and a third party may be brought into a contractual relationship. The legal effect of such acts by agents is that the person for whom they are acting - the principal – is bound by such acts and may incur legal obligations to the third party who has dealt with the agents. By this, the law of agency is able to multiply the individual´s legal personality in space. Generally, the agent´s acts have such effect because the principal has authorized the agent to do the acts in question and the agent has agreed. The agent in a sense becomes an extension of the principal and is therefore capable of altering the principal´s legal position either by binding him to a contract or effecting a binding disposal of the principal´s property. An agency relationship is fiduciary in nature and the actions and words of an agent exchanged with a third party bind the principal. Keywords: Agent, Principal, Third Party, Contractual Relationship, Legal Obligation, Legal Personality, Fiduciary Relationship. Page | 1 Table of Contents PAGE CONTENTS NO. INTRODUCTION……………………………………………………………... 3 AN OVERVIEW OF AGENCY……………………………………………… SIX GROUNDS TO BIND A PRINCIPAL BY ACTS OF THE AGENT………………………………………………………………………... 4 6 RELATIONSHIP BETWEEN THE PRINCIPAL AND AGENT...…............. 11...
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...with some goods by third parties, or be conferred with some benefits etc., the position of such person in such like situations is being discussed below. THE POSITION OF A MINOR Who is a minor ? A person who has not attained the age of majority is a minor. Section 3 of the Indian Majority Act, 1875 provides about the age of majority. It states that a person is deemed to have attained the age of majority when he completes the age of 18 years, except in case of a person of whose person or property a guardian has been appointed by the Court in which case the age of majority is 21 years. Nature of a minor’s agreement As noted above a minor is not competent to contract. One question which arises in case of an agreement by a minor is, whether the agreement is void or voidable? The Indian contract Act does not have any provision to answer this question. In the absence of any statutory provision there had been controversy on this point. The controversy was set at rest by the decision of the Privy Council, in the case of...
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...Topic Two Contract Law: Formation of Contracts [A] Introduction Contract law concerns with regulation of the legal relationship of the parties to contracts. A contract is an agreement having legally binding effects on its parties. In other words, generally speaking, the party who broke the contract has to compensate the innocent party for his loss. How to form a contract? All the 4 following elements are needed for forming contracts: - a. Offer b. Acceptance c. Intention d. Consideration [B] Offer What is an offer? • The expression of a person’s intention to others to have a legally binding agreement. • The maker of the offer is called the offeror. The recipient is called the offeree. Important rules about offers: - (a) Certainty of the offer A contract must contain the basic terms of the relevant transaction. Normally, the following 2 items are needed to form an agreement: - i. Price (e.g. how much is the house that I am going to sell to you?) ii. Property (the seller has to show the buyer the goods or to describe them briefly: Hillas & Co Ltd v Arcos Ltd [1932] All ER Rep 494). * Under the Sale of Goods Ordinance (cap.26 of the Laws of Hong Kong), the buyer is required to pay a reasonable price for his purchased goods if there has not been a specified price in the agreement. Under the Supply of Services Ordinance (cap.457 of the Laws of Hong Kong, the party contracting with the supplier has to pay a reasonable...
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...Ratification: an agent secures a contract on behalf of the principle and the principle agrees to it. Buy custom Law of Agency: Amber and Ashgan Case Study Analysis essay The law of agency applies to both the two individuals in the case given that they possess an agent-principal type of relationship. Thus, the law of agency between the two is narrowed-down to the duties of the agent in respect to their respective principals. It should be noted Ashgan, the personal assistant, is the agent while Amber, who happens to be the employer, is her immediate Principal, The first duty of Ashgan, as an agent, is not to become the principal as against her employer’s or principal’s knowledge. This duty, on the part of the agent, is meant to prevent her from situations in which there will be possible conflict of interest between her duty as an agent and her personal interest. Notwithstanding, a breach against this course of duty renders the contract, entered into by the agent, as voidable at the desire of the true principal. For this case, the contract to purchase the limited edition, sliver Bays-water Tote handbag created the aforementioned type of conflict and thus, it was Amber to decide whether or not the contract was voidable. Second, the agent has a duty not to engage in business activities and hence making secret profits. It should be noted that secret profits is a phrase taken to mean any form of material or financial benefit that may be accrued on the part of the agent without the...
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...Elements of the law of contract Catharine MacMillan Richard Stone 2009 LLB 2650040 Diploma in Law 2690040 page 2 University of London External System This subject guide was prepared for the University of London External System by: u Catharine MacMillan BA (Victoria) , LLB (Queen’s, Canada), LLM (Cantab), Lecturer in Law, School of Law, Queen Mary, University of London and u Richard Stone LLB (Soton), LLM (Hull), Barrister, Professor and Head of Law, Lincoln Law School, University of Lincoln. In the 2004 edition of this guide Catharine MacMillan was primarily responsible for Chapters 1–2, 4–5, 7–8, 10–14 and 16–17. Richard Stone was primarily responsible for Chapters 3, 6, 9 and 15. Catharine MacMillan was responsible for the 2009 revision. This is one of a series of subject guides published by the University. We regret that owing to pressure of work the authors are unable to enter into any correspondence relating to, or arising from, the guide. If you have any comments on this subject guide, favourable or unfavourable, please use the form at the back of this guide. Acknowledgements Figure 15.1 has been reproduced by kind permission of: u Figure 15.1: © Illustrated London News Picture Library. Photographs © C. MacMillan, 2003 Publications Office The External System University of London Stewart House 32 Russell Square London WC1B 5DN United Kingdom www.londonexternal.ac.uk Published by the University of London Press ©...
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...ASSESSMENT COVER SHEET DECEMBER SUBMISSION |Unit Number and Title |Unit 5 Aspects of Contract and Negligence – Level 4 | |Assessment Title |Aspects of Contract & Negligence | |Course Title |HND Business | |Assessment Code |HNDBUSMandatoryunit 5/HNDBUSUnit5/Oct2013 | |Hand Out Date |11th October 2103 |Hand In Date |21st December 2013 | |Lecturer(s) |John Owen |Internal Verifier |Jonathan Cartmell | | |Michael Evans | | | | |Anuja Prashar | | | |Sources of information |Course notes. ...
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...of questions on the final exam. Please use them a study aid to prepare for the final exam. 1. In a civil lawsuit against Ellen, Fred obtains an injunction, which is: a. a remedy at law. b. an equitable remedy. c. not possible under our U.S. system of jurisprudence. d. none of the above. 2. Our society has laws for which of the following reasons: a. to provide stability and predictability in personal and business affairs. b. to provide society with guidance as to what acts are considered legally http://www.mangahere.co/manga/fairy_tail/v38/c384/right and legally wrong. c. to provide penalties and sanctions for wrongful acts. d. all of the above. 3. Common law rules develop from: a. statutes enacted by Congress and the state legislatures. b. the principles behind the decisions in hypothetical disputes. c. the principles behind judicial decisions in actual legal disputes. d. propositions voted on by state residents and enacted into law. 4. What is the doctrine under which judges are obligated to follow the precedents established in prior decisions? a. stare decisis. b. res ipsa loquitur. c. commom law d. post hoc. 5. In a particular case, if a court decides that an established rule of precedent is incorrect or inapplicable, the court: a. must refuse to decide the particular case. b. must apply the precedent. c. may...
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...suitability and the steps involved in their formation. Y OBJECTIVES After studying this lesson, you will be able to: • • • • • explain the concept of business organisation; state the meaning and characteristics of Sole Proprietorship, Partnership, Joint Hindu Family Business and Cooperative Societies. identify the merits and limitations of these forms of business organisation; describe the suitability of these forms of business organisation; and explain the steps in the formation of these business organisation. 5.1 BUSINESS ORGANISATION You have already learnt about the meaning of business and the various types of business activities like industry, trade, transport, banking, insurance etc. If you observe these business Business Studies 89 MODULE -2 Business Organisations activities carefully, you will realise that whatever business activity one may take up, he has to bring together various resources like men, money, materials, machines, technology, etc. to carryout that activity successfully. Not only that these resources are to be put into action in a systematic manner to achieve...
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...law arise when agents make contracts on behalf of principals. Should a principal be bound when his agent makes a contract on his behalf that he would immediately wish to disavow? The tradeoffs resemble those in tort, so the least-cost avoider principle is useful for deciding which agreements are binding and can unify a number of different doctrines in agency law. In particular, an efficiency explanation can be found for the undisclosed-principal rule, under which the agent's agreement binds the principal even when the third party with whom the contract is made is unaware that the agent is acting as an agent. Agency deals with situations in which one person -- the principal-- uses another person -- the agent-- to act on his behalf. Sometimes the acts of the agent are attributed legally to the principal, sometimes not. Clearly, agency is central to business dealings. No owner of a business can do everything himself; he must delegate some things to agents, and this is true not only of large corporations but of sole proprietorships that have employees who work for the owner. In partnerships, the partners act as each other’s agents. And in corporations, the shareholders are completely unable to act on their own behalf; they delegate authority to a board of directors, who in turn delegate authority to the officers of the corporation. In this report we will discuss the formation and types of agencies with a detail analysis of the evident problems between principal-agent relationships...
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...The wisdom behind this principle is to maintain consistency in law and to oust any ambiguity or confusion concerning any subject. PARTIES TO THE CONTRACT OF AGENCY AGENT AND PRINCIPAL: AGENT: Agent is an individual or firm authorized to act on behalf of another (called the principal), such as by executing a transaction or selling and servicing an insurance policy. The agent does not assume any financial risk in the transaction. The function of the agent is to act on behalf of his principal in bringing about a contract between his principal and a third party. The relationship between principal and agent can arise in many ways, by contract under seal or in writing or verbal, by contract implied from the conduct or situation of the parties and by ratification. An agent such as a director has a lot of duties for the company. He must act in good faith in the interests of the company. As well, he has duty to avoid actual and potential conflicts of interest. If the agent breaches his duty, he may be sued by the company, the liquidator, the creditor, the shareholder and even ASIC. Furthermore, the principal can get compensation for the agent's breach behavior. EXAMPLE: C appoints B to buy 10 bags of sugar on his behalf. C is the principal and B is the agent. The contract between the two is agency. PRINCIPAL: An agent who makes a contract on a principal's...
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...Law of Contract What is a legal agreement Contract is an agreement which the law will enforce. What is the difference between an agreement and a legally binding agreement? To understand this problem we should consider two scenarios. The first is if we ask a friend or colleague to have lunch with us and they agree. There is an offer and an acceptance. If we were to be asked if we are suing the friend or colleague for breach of contract our answer would be an emphatic no. (Why would we give an emphatic no? What is the common sense reason for this?) Before going further into this scenario lets look at a different one. We make a booking at a hotel. We fail to turn up. The hotel having reserved a room for us has been unable to sell the room to anyone else. If the hotel were to sue us we would accept the fact because there is an intention to create legal relations.Why? Because it is a business relationship. In the same way if the hotel had sold our room we would consider legal action of our own. A legally binding contract needs offer, acceptance, intent to create legal relations and consideration. It is the presence of intent to create legal relations and of consideration that converts a social agreement into a legal agreement. Offer Characteristics of an offer Must be certain : Gunthing v Lynn 1831 Must be differentiated from an enquiry : Harvey v Facey 1893 Must be differentiated from an intent to trade: Pharmaceutical Society of Great Britain v Boots 1953 May be...
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...1. Introduction 1.1 From the dawn of human civilization, we, human being are directly or indirectly dependent to each other. For our better living, we created family, then formed group/society, then country and international community. Each individual, each family, each group and each country are dependent on each other by some means. For the easy exchange of dependency, people introduced business. “Business is defined as the exchange of goods, services or money for mutual benefit or profit.” (Skinner and Ivanncevich, 1992, p.8) The organizations that involve in profit making activities are called business organizations. Business may be trade, commerce or industry. To make business organized, it must be governed by some rules and regulations which we call business laws. Each country has independent business laws. Business organizations must operate within the boundaries of laws and government regulations. 1.2 Laws have been developed not only to protect consumers but also to preserve competition. Government agencies enforce these laws at the federal, state, and local levels. Business firms that do not comply with the laws face fines and other penalties. 2. Aim The aim of this assignment is to give a general idea regarding the laws that affect business. 3. Scope In this assignment I have limited my focus on the laws of Bangladesh that affect business. However, I have also focused on some of the laws of USA, UK and India those affect business but not yet clearly...
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...Outline 1. Agency a. Creating the Agency Relationship i. agent and principal enter into an agreement (not required to be in writing....no K required) in which the agent acts on the principal’s behalf in entering K’s etc…. 1. if done within the scope of the agency (enter into K, etc…) anything done by the agent is binding on the principal 1. principal may be liable in K, tort, property, etc…. (Vicarious liability) ii. question of agency is a factual matter to be determined as a “matter of fact” b. Res 3d Agency 1.01 (definition of “Agency”) i. Agency relationship created when (First Question to ask when dealing with agency) 1. The principal manifests assent to have the agent act on the principal’s behalf and under the principal’s control; and 2. The agent manifests assent or otherwise consents so to act 1. When agency exists the principles of attribution bind’s the principals to agents dealings with third parties 2. manifestation need not be by words (spoken or written), it may be created by conduct/actions i. Agent rx believes that Principal has manifested assent, and has rx accepted ii. (Notes….Legal Consequences of Agency) 1. Inward Looking Consequences: relate to the relationship between the principal and the agent and are largely governed by the contracts between the parties and by the law of fiduciary duties 2. Outward Looking Consequences: relates to the relationship among the principal, the agent, and a third party and are governed by various “principles...
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...formation of a contract. INTRODUCTION In this topic, you will be introduced to the laws which govern the formation of a contract in Malaysia. You should understand the definition of a contract and each basic element in the formation of a contract, which are made up of offer, acceptance, consideration, capacity, intention and certainty. Students will not only find Malaysian Acts and cases applied in the discussions, but also those from England, India and Singapore. These are facts neces sary to support your answers during the examination. With a clear understanding of all the points above, you should be able to complete all the exercises given in this topic. 2 TOPIC 1 INTRODUCTION AND ELEMENTS OF A CONTRACT 1.1 INTRODUCTION, DEFINITION AND BASIC ELEMENTS OF A CONTRACT In Malaysia, the Contracts Act 1950 (hereafter referred to as CA 1950) governs the formation of a contract. The Sale of Goods Act 1957 governs contracts for the sale of goods, whereas hire-purchase contracts are governed by the Hire-Purchase Act 1967. Apart from these Acts, students will also study English cases and statutes which are accepted as authority based on the provisions of Sections 3 and 5 of the Civil Laws Act 1956. However, it must be noted that these English laws are only adopted as persuasive authority and does not bind the decisions of the Malaysian courts. Furthermore, the application of English Laws shall only be made if there is a lacunae in the local laws and insofar as it...
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...their support this study pack would not have been a success. To them I say keep the god spirits for enhancing the college and making it a force top reckon with according to international standards. Would also like to thank the Trust Academy Secretaries and Typists of this book, particularly, SHELTER MAVHUNGA, MISI MAKUZWA, AMANDA MANDA and JESCA KAMUNGA for their commitment to duty. Again their handwork in the production of this copy is highly appreciated. Anyone who directly contributed to the success of this module I say, God bless you. However none of the above will be accountable for any errors of omission or commission which might appear in this study pack. M. MAVHUNGA 2 Dedication This study pack is dedicated to the targeted students who commit themselves to passing the interesting course of business law. Foreword Business Law is a very broad course and covers many aspects. It is a challenging course a proper approach is not advised to new students but an interesting and very simple course once one grasps the concepts. The objective of this module is to simplify Business Law to be understood by Ordinary Advanced Level students who may be taking any of the above courses. The field has been complicated by legal jargon used by some authors and leaving students complaining that such sources are not very digest. Not really attacking other textbooks, but only trying to reveal some experience gathered when dealing with students of these courses This study pack will assist...
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